Target acknowledged Thursday that data connected to about 40 million credit and debit card accounts was stolen as part of a breach that began over the Thanksgiving weekend.

It’s considered the largest credit card breach in U.S. history since the breach discovered in 2007 involving retailer T.J. Maxx and roughly 45 million card users.

This massive breach is a wake-up call for organizations to take a better look at what types of security they have in place, and what types of training their employees are going through.

Already, at least two lawsuits seeking class-action status have been filed against Target. And attorneys general from New York, Massachusetts, and Connecticut have contacted the retailer seeking more information about the breach and the steps being taken by Target to protect consumers.

And according to media reports, these stolen consumer data are already flooding the black market. Credit and debit card accounts stolen from Target’s data breach are being sold on underground black markets for anywhere from $20 to more than $100 per card, reports KrebsOnSecurity, a security news website.

In such data breach cases, there are several policies that are important for the companies to look at as possible insurance coverages to be triggered, according to attorneys who spoke with Insurance Journal.

Target declined to comment on an inquiry regarding its insurance coverage. But attorneys observed many companies are purchasing insurance coverages to protect against such data breaches.

“A lot of companies are purchasing specialized cyber insurance policies so those have to be examined,” said Joshua Gold, a New York-based attorney and shareholder at law firm Anderson Kill. Gold regularly represents corporate policyholders in insurance coverage matters. Such cyber insurance can be tailored to cover a wide range of expenses, even costs for forensic accounting, credit monitoring, crisis management, notification and setting up call centers to respond to consumer inquiries.

There could also be some measure of protection under traditional policies like the commercial general liability policy, even though finding coverage under traditional policies may be getting increasingly more challenging as the industry continues to add data breach-related exclusions. Most recently, Insurance Services Office Inc. (ISO) filed this year data breach exclusion endorsements concerning its standard-form primary and excess/umbrella commercial general liability policies, to be effective next May. http://www.insurancejournal.com/news/national/2013/12/22/315222.htm

According to a 2012 Cyber Claim Study, the most frequently breached sectors are healthcare and financial services. The average cost per breach was $3.7 million, with the majority devoted to legal damages.  http://www.netdiligence.com/files/CyberClaimsStudy-2012sh.pdf

Approximately 25 insurers now offer Cyber insurance, and all these carriers offer coverage for both first-party and third-party losses. – See more at http://www.mcguirewoods.com/Client-Resources/Alerts/2013/10/Buyers-Guide-to-Cyber-Insurance.aspx#sthash.QnTC8PE9.dpuf

Texas tops the list for the most claims filed in 2012 according to a State Farm report with residents filing some 47,000 claims, followed by Illinois with 41,000, New York with about 34,000, Ohio with 31,000, Missouri with 25,000, Tennessee with 24,000, Indiana and New Jersey with 23,000, Kentucky with 22,000 and Colorado with 16,000.

The National Insurance Crime Bureau (NICB) reported in July 2013 that insurance claims resulting from hailstorm damage increased 84 percent in 2012 from their 2010 level. In 2010, there were 467,602 hail damage claims filed. That number increased to 689,267 in 2011 and to 861,597 in 2012—an overall increase of 84 percent from 2010 to 2012.

Over 2 million hail damage claims were processed from Jan. 1, 2010, to Dec. 31, 2012. During this period, the top five states generating hail damage claims were Texas (320,823); Missouri (138,857); Kansas (126,490); Colorado (118,118) and Oklahoma (114,168).

In 2010, 2011 and 2012, Texas was the state with the most hailstorm events with 557, 741 and 795, respectively.

If you are dealing with a Wind and Hail Damage Insurance Claim your commercial building or home, you may be entitled to an insurance claim settlement. Contact an experienced licensed Public Insurance Adjuster to ensure you are getting the settlement you deserve. Call Insurance Claim Recovery Support today at (855) 203-2226 for a complimentary claim consultation.


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